FTSE 100 hits two-month high as oil stocks rebound

The FTSE 100 jumped to a two-month high on Tuesday, as oil stocks bounced back following a bullish brokerage recommendation and news that OPEC+ members were not discussing an oil output increase.

The commodities-heavy FTSE 100 rose 0.6% to its strongest level since Sept. 13.

Oil majors Shell (LON:RDSa) and BP (LON:BP) jumped 2.9% and 4.8% as crude prices gained after Saudi Arabia’s energy minister denied a report that said OPEC oil producers were discussing a potential output increase. [O/R]

Meanwhile, Citigroup (NYSE:C) raised BP’s rating to “buy” from “neutral” and said it expects the rotation into energy stocks to continue.

Britain’s energy sector surged 3.5%.

The more domestically focused FTSE 250 midcaps slipped 0.2%, reflecting a cautious mood in the equities market on concerns about aggressive rate hikes and slowing economic growth.

Among individual stocks, GSK Plc slipped 0.8% after the drugmaker said it has initiated a process to withdraw U.S. approval for its blood cancer drug Blenrep, after the therapy failed to meet the requirements of a key trial.

AO World jumped 13.3% after the online electrical retailer struck a positive note on annual profit outlook due to its cost-saving steps.